Play Live Radio
Next Up:
Available On Air Stations

A San Diego Company Could Become Part Of AT&T


San Diego-based LEAP Wireless' stock price continues to go up in value since AT&T put a buyout offer on the table late last week. LEAP's stock price has climbed beyond the $1.2 billion offer.

A San Diego Company Could Become Part Of AT&T
A Qualcomm spinoff could become part of AT&T — the wireless giant is looking to buy LEAP Wireless for more than $1.2 billion.

Investors are reacting to the interest in the San Diego company since the buy-out bid was made public.

AT&T offered $15 per share for the company but the current stock price has risen above that.

The local company has two valuable assets: customers and wireless spectrum. Even so, the proposed buyout is far from a done deal.

"The FCC could get involved," said Nikhil Varaiya, a San Diego State University finance professor. "They may be concerned about there being fewer players like LEAP. Certainly, LEAP was offering services that were less expensive than the other players," he said.

LEAP carved out a niche in the wireless market by offering cell phone access without long-term contracts. Customers pay each month for their next month's services. LEAP was created, then spun off by Qualcomm.